Having trouble with KMS too, starting about 4 weeks ago. First blamed
Plymouth, but although there are issues there as well, I'm now sure that
this is a separate problem. (see also bug 519891).

Problem comes and goes, about half the time I can boot normally and get
into my system fine. The other times the system gives me a pattern of
vertical coloured lines and is unusable. Hard reboot and adding
'nomodeset' to the grub linux-line does give me a usable system.

This is a Dell Latitude 131L, AMD64, Lucid with all updates applied at least 
once a day (usually twice a day).
>From lspci:
01:05.0 VGA compatible controller: ATI Technologies Inc RS482 [Radeon Xpress 
200M]
>From grub.cfg:
menuentry "Ubuntu, with Linux 2.6.32-13-generic" {
        recordfail
        insmod ext2
        set root=(hd0,5)
        search --no-floppy --fs-uuid --set 46062d1f-f00c-4276-9ff1-541279640a93
        linux   /boot/vmlinuz-2.6.32-13-generic 
root=UUID=46062d1f-f00c-4276-9ff1-541279640a93 ro   quiet splash
        initrd  /boot/initrd.img-2.6.32-13-generic
}

I insert the 'nomodeset' right before the 'quiet splash'

There are plenty of systems out there with this chip, and installing
Lucid will break them as it is now. This should be concerned important,
probably critical.

If I can do more to help get this fixed, please ask.

cheers
Tom

-- 
[Lucid] ATI KMS causes DRM error
https://bugs.launchpad.net/bugs/509273
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